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First-time homebuyers in South Africa now have added support to get their foot on the first rung of the property ladder, thanks to a new partnership between legal technology company LexisNexis SA and conveyancing firm MDW Inc. The two industry players have joined forces to grow awareness among aspirant homeowners of property funding available through the South African government’s Finance Linked Individual Subsidy Programme (Flisp). LexisNexis is using its extensive network to encourage conveyancing attorneys and their employees to advise first-time homebuyers of the funding opportunity, whereas MDW Inc is authorised to facilitate the applications on behalf of the attorneys and their clients.
Subsidies are available for up to R121,000 for those within the gap housing market (households with an income of R3,501 to R22,000). The subsidy acts as a cash contribution or deposit to supplement an approved home loan and may be used towards the purchase or construction of a property. Funding is calculated on a sliding scale according to the gross income of the first time homebuyer. The subsidy is paid into the bank or financial institution granting the bond, reducing the homebuyer’s monthly loan instalments and making it more affordable to purchase or build a home.
Once approved, the funds can be used towards the purchase of an existing residential property for the first time, to purchase a vacant serviced residential stand (or plot) linked to house-building contracts, or to build a new house on a serviced residential stand that the applicant already owns. Builders must, however, be registered with the National Home Builders Registration Council (NHBRC). MDW Inc director Meyer de Waal says the partnership with LexisNexis is an extension of his longstanding commitment to ensuring that property access and property rights are afforded to more people.
“I’ve been surprised at the inadequate knowledge that exists publicly of available funding vehicles for property purchases,” he says. “I hope that partnering with a legal powerhouse like LexisNexis SA will accelerate awareness and enable more people to fulfil their dreams of property ownership. I also believe it should be an obligation for conveyancers to alert their clients to opportunities like Flisp.” According to ooba, the percentage of first time homebuyers has been rising steadily since late-2007, reaching a record high of 56.2% in May last year.
Meanwhile FNB reports that data from the Deeds Office shows younger buyers (below the age of 35) now account for 43% of residential sales – up from 38% in 2019. Lightstone Property data also indicates that most first-time buyers enter the residential property market in the R700,000 to R1,5m price band. For application criteria and further information, visit mybondfitness.info/lexisnexisflisp.
SOURCE: First Published on Everything Property